Seeking Alpha
Long/short equity, insider ownership
Profile| Send Message|
( followers)

Summary

  • 4 insiders sold Realty Income stock within one month.
  • The stock was not purchased by any insiders in the month of intensive selling.
  • 3 of these 4 insiders decreased their holdings by more than 10%.

Realty Income Corporation (NYSE:O) is a publicly traded real estate investment trust.

(click to enlarge)

Insider selling during the last 30 days

Here is a table of Realty Income's insider activity during the last 30 days.

NameTitleTrade DateShares SoldRule 10b5-1Current OwnershipDecrease In Ownership
John CaseCEOMay 915,000No263,527
shares
5.4%
Gregory McLaughlinDirectorMay 85,225No18,672 shares21.9%
Michael PfeifferEVPMay 516,000No79,787 shares16.7%
Paul MeurerCFOMay 516,259No68,397 shares19.2%

There have been 52,484 shares sold by insiders during the last 30 days.

Insider selling by calendar month

Here is a table of Realty Income's insider activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
May 201452,4840
April 201400
March 201400
February 201400
January 201400
December 201300
November 201300
October 201300
September 201338,2100
August 201300
July 201300
June 20130800
May 201387,9100
April 201331,2500
March 2013127,7020
February 201300
January 201300

There have been 337,556 shares sold, and there have been 800 shares purchased by insiders since January 2013.

Financials

Realty Income reported the first-quarter financial results on May 1 with the following highlights:

Revenue$221.6 million
FFO$134.5 million
Net income$47.2 million
Cash$14.1 million
Debt$4.8 billion

The four insiders sold their shares after these results.

Outlook

Realty Income's 2014 guidance is as follows:

FFO$2.53-$2.58 per share
EPS$0.86-$0.91

Competition

Realty Income's competitors include Kimco Realty Corporation (NYSE:KIM), National Retail Properties (NYSE:NNN), and Regency Centers Corporation (NYSE:REG). Here is a table comparing these companies.

CompanyOKIMNNNREG
Market Cap:9.69B9.31B4.33B4.95B
Employees:11859762363
Qtrly Rev Growth (yoy):0.260.090.130.10
Revenue:824.42M950.98M403.93M520.72M
Gross Margin:0.950.740.950.76
EBITDA:726.50M573.05M352.21M328.53M
Operating Margin:0.480.340.620.38
Net Income:157.76M198.39M133.04M63.01M
EPS:0.940.431.131.40
P/E:46.8252.8631.0938.34
PEG (5 yr expected):3.204.304.993.56
P/S:11.829.8710.739.53

Realty Income has the highest P/S ratio among these four companies.

Here is a table of these competitors' insider activities this year.

CompanyInsider buying / sharesInsider selling / shares
KIM05,375
NNN077,036
REG027,839

Only Realty Income has seen intensive insider selling during the last 30 days.

Conclusion

There have been four different insiders selling Realty Income, and there have not been any insiders buying Realty Income during the last 30 days. Three of these four insiders decreased their holdings by more than 10%. Realty Income has an insider ownership of 0.63%.

There are five analyst buy ratings, seven neutral ratings, and three sell ratings with an average price target of $41.58. Before going short Realty Income, I would like to get a bearish confirmation from the Point & Figure chart. The three main reasons for the proposed short entry are a relatively high P/S ratio, bearish analyst price targets, and the intensive insider-selling activity.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: Realty Income: 4 Different Insiders Have Sold Shares This Month